John Paulson Predicts That Double Digit Inflation is Coming - In 2012

There is no question that John Paulson, head of Paulson and Co Inc., has attracted an enormous following over the past couple of years.

And why not? Paulson correctly predicted the implosion of the subprime mortgage market in the United States, making himself and his investors billions of dollars in the process. John Paulson became a hedge fund superstar almost overnight, and continued to build on his monumental successes in 2007 with strong performances in both 2008 and 2009.

Paulson and Co Inc. is now one of the largest hedge fund firms in the world, and John Paulson is easily one of the most revered and respected voices in the investment community. Say what you want about John Paulson, but you can't deny his success since 2007.

So, having said all of that, you can imagine the reaction when John Paulson took the mic at the University Club in New York and pronounced that double digit inflation is coming by 2012.

Wait - what?

Paulson argues that low GDP growth (he projects 2% GDP growth in both 2011 and 2012) and quantitative easing from the Fed "should contribute to double-digit inflation over the next few years".

For those of you who aren't near a calendar, 2012 is just over 15 months away.

John Paulson also had some other predictions/recommendations, including: